But some parts of simulations can be extremely misleading. Some things scale down very nicely other not at all. Even in physics it's not possible to really scale down everything - that's why wind-tunnels can't always be operated with normal air but need special measures to achieve a realistic environment.

But back to simulations in the field of knowledge-work...
I ran the getkanban simulation (v2) a couple of times now and found that it does a very good job of scaling down the mechanics and at the same time illustrating some of the concepts in a ver tangible manner. Except for the retrospectives or operations reviews.
With the Kanban Pizza Game the effect was even stronger. When we ran it at the Limited WIP Society Cologne(German site) we really liked the way it emphasized the tremendous effect that can come from limiting the work in progress and other aspects of the Kanban Method - except for the retrospectives.
With 5 Minutes for a retrospectives and given the fact that speedinguptheconversationdoesntreallywork (speeding up the conversation doesn't really work) it is hard to hear everyones voice in a retrospective. And of course – as Tom DeMarco points out in "The Deadline" – people also can't really speed up their thinking. It takes a certain amount of time to process information.
What's more: Scaling down retrospectives or operation reviews this much gives people who never experienced a real retrospective a wrong impression – and totally contradicts the concept of Nemawashi!

And this is true for most of the aspects that involve human interaction – root cause analysis, value stream mapping, A3-reporting, designing Kanban systems (as opposed to using them) etc. This is one of the reasons Tom and I designed the Hands-on Agile and Lean Practices workshop as a series of simulations alternating with real-time interjections of the real thing (e.g. a 30 minute value-stream mapping inside a 20 minute simulation, so that people really can experience the thought-process and necessary discussions).

Nowadays I try to balance my simulations in such a way that the systemic part of an aspect is displayed and emphasized through the simulation while the human aspects are given enough space to be a realistic version of the real thing.